BUILDING AMENDMENT ACT 2013
Building Act 2004 (Aug 2013 reprint) has been amended by the Building Amendment Act 2013 (28 November 2013). Some changes come into force immediately and some will come into effect sometime in mid 2014. The following is a brief outline of changes, however some items are dependent on the yet to be written associated regulations.
Amendments which take immediate effect include:
- The type of work that does not require a building consent has changed.
- Higher penalties for doing building work without the appropriate consents, now up to $200,000.
- A number of terms and definitions have been changed.
- Manufacturers and suppliers who state their products comply with the Code, now have responsibilities under the Act.
- Easing in the requirements for existing buildings, change of use and subdivisions.
- Councils have increased authority to restrict entry to buildings that may be near to buildings that are dangerous.
- MBIE has more power to hold building consent authorities to account.
- The way dams are defined and measured has changed.
Amendments which take effect in mid-2014 include:
- New consumer rights & remedies for residential building work:
- New consumer protection measures.
- Written contracts for building work over a certain value will be mandatory.
- Building contractors will be required to disclose certain information to consumers.
- New general remedies for breaches of implied warranties will apply.
- A 12 month defect repair period will apply; a building contractor will be required to remedy any defects notified by the consumer without question.
- Dispute resolution introduced.
- Changes to the dam safety scheme
Work not requiring a Building Consent.
Schedule 1 of the Building Act covers building work that does not need a building consent. The latest amendment introduces a newly formatted and slightly expanded Schedule 1, it is divided into 3 parts:
It is worth looking at the schedule, as some of those small projects may not need a Consent, or possibly their cost may not need to be included in the assessment of a larger project consent fee (BCA's may beg to differ on this?). Refer to Schedule 1: Building work for which building consent not required, in the Building Amendment Act 2013.
- Part 1 covers general exemptions and limitations – such as repairs, maintenance and small or simple structures.
- Part 2 covers sanitary plumbing and drainlaying done by anyone authorised under the Plumbers, Gasfitters and Drainlayers Act 2006.
- Part 3 covers building work designed or reviewed by a chartered professional engineer.
The major one is the term ‘compliance document’ which is replaced in the Building Act by ‘acceptable solution and/or verification method'.
'Certificate of Work' by an LBP Design, replaces the old term 'memorandum'. A definition of liability with regard to this has also been added in.
Manufacturers and suppliers responsibilities.
Manufacturers and suppliers who state their products comply with the Code, now have responsibilities under the Act to ensure that, if installed in accordance with their requirements, they will comply with the Code.
Existing buildings and sub-divisions.
There has been a slight easing in the requirements for alterations to existing buildings, change of use and subdivisions.
MBIE has more power to hold building consent authorities to account
The Chief Executive of The Ministry of Business, Innovation and Employment (MBIE), has more flexibility and powers around investigating any issue involving a BCA, and holding the BCA to account with regard to complaints.
New consumer protection for residential building work
Major new consumer protections are introduced into the Building Act in the new Part 4A: Consumer rights and remedies in relation to residential building work. Scheduled to come into force from mid 2014, this part includes:
- Builders to provide certain information before a contract is signed, such as:
- The legal status of the builder, including whether they are an individual, a partnership or a company etc.
- Whether the builder has been involved in any disputes
- The skills, qualifications, and licensing status of the building practitioners doing the work.
- An explanation of the legal obligations of the client and the builder
- Outline the risks of paying in advance for building work
- Sources of further information.
- Sets minimum requirements for residential contracts over a certain value:
- For building work above a certain minimum sum, there must be a written and dated contract, and it must meet requirements in the regulations.
- Explains implied warranties in residential contracts:
- Implied warranties apply to Building Contracts or sale agreements (subject to Contracts) with on-sellers.
- The building work to carried out competently, in accordance with the contract plans, specifications and the consent.
- Materials to be fit for purpose and to be new (unless stated otherwise).
- The work to meet all legal requirements.
- The work to done with reasonable care and skill and completed by the date (or within the period) specified in the contract or, if no date or period is specified, within a reasonable time.
- The residence will be suitable for occupation on completion.
- Provides remedies for breaches of implied warranties:
- The client may require the builder to fix the work and repair or replace defective materials. If the builder does not fix things within a reasonable time, the client may have the work done by someone else and recover costs from the builder, or they can cancel the contract.
- Where the breach of warranty is substantial or cannot be fixed, the client may get compensation from the builder for any reduction in value of the building work below the price they paid, or they can cancel the contract.
- The client may also obtain damages from the builder for any loss or damage resulting from the breach (other than loss or damage through reduction in the value).
- Builders can’t contract out of this. It applies to the work of the builder, as well as employees and subcontractors the builder is responsible for.
- Building/land owners that are non-parties to a related contract may take proceedings (Adjudication, Arbitration, WHRS) for breach of warranties.
- Requires builders (or on-seller) to fix defective residential building work if notified, without question:
- Within 12 months of the completion of building work, if a defect is found and it can be remedied, clients can notify the builder and ask them to remedy the defect.
- The builder must remedy the defect (including repairing or replacing defective materials supplied by the builder) within a reasonable time.
- The builder may have to pay the client for any loss or damage from the defect (other than loss or damage through reduction in value) that they should have known the defect could cause.
- This applies only to contracts entered into after this section comes into force in 2014. It doesn’t apply if the problem wasn’t the fault of the builder or anyone the builder was responsible for, or if the client neglected maintenance or failed to act as soon as the defect became apparent.
- Requires builders to give clients certain information on completion of work:
- After completing building work under a residential contract, the builder must give the client and the BCA the documentation listed in regulations. This might include things such as guarantees relating to the work and maintenance requirements.
- Dispute resolution introduced:
- MBIE may provide assistance in dispute resolution of any dispute arising under a residential building contract.
We understand that MBIE will be developing the regulations in relation to Building Amendment Act 2013 over the coming months, this should provide more detail on some of the items raised here.
For more Information go to:
To view the Building Amendment Act 2013 go to: